Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/69381
Authors: 
Delgado, Michael S.
Henderson, Daniel J.
Parmeter, Christopher F.
Year of Publication: 
2012
Series/Report no.: 
Discussion Paper Series, Forschungsinstitut zur Zukunft der Arbeit 7089
Abstract: 
Empirical growth regressions typically include mean years of schooling as a proxy for human capital. However, empirical research often finds that the sign and significance of schooling depends on the sample of observations or the specification of the model. We use a nonparametric local-linear regression estimator and a nonparametric variable relevance test to conduct a rigorous and systematic search for significance of mean years of schooling by examining five of the most comprehensive schooling databases. Contrary to a few recent papers that have identified significant nonlinearities between education and growth, our results suggest that mean years of schooling is not a statistically relevant variable in growth regressions. However, we do find evidence (within a cross-sectional framework), that educational achievement, measured by mean test scores, may provide a more reliable measure of human capital than mean years of schooling.
Subjects: 
mean years of schooling
human capital
irrelevant variables
significance testing
nonparametric
JEL: 
C14
J24
I20
O10
O40
Document Type: 
Working Paper

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